A nationwide review of state insurance filings shows that carriers have filed generative AI exclusions across the standard commercial lines contractors carry, up from zero in mid-2025. Trades Coverage, a licensed insurance producer and marketplace, identified 4,078 state-level records across 49 states and the District of Columbia through July 31. Of those, 2,369 were already in force.
The source of the exclusions is a set of six standard forms that the Insurance Services Office (ISO) published in July 2025. ISO develops the standard policy language used across the US property and casualty market, and carriers began filing those forms one month after publication. By February, monthly supporting filings peaked at 413, according to the report.
Of the 4,078 records, 3,955 involve coverage lines contractors and small businesses commonly carry: commercial general liability, umbrella and excess, commercial package, businessowners, and errors and omissions. The exclusion is not confined to a single narrow line.
The ISO forms come in three versions. The broadest, CG 40 47, strips out bodily injury, property damage, and advertising injury claims arising from generative AI. CG 40 48, meanwhile, removes advertising injury only. A third, CG 35 08, targets completed operations, the coverage a contractor relies on after a job closes.
Under the broadest form, a claim need only arise out of generative AI. A contractor using AI for one estimate on an otherwise conventional job could find a later claim on that project falls within the exclusion. The trigger is the connection to AI, not the proportion of work it touched.
"A contractor might use AI for one estimate, takeoff or design decision and do the rest of the job without it," said Matt Levin, head of research at Trades Coverage. "If that work contributes to a later claim, the exclusion could apply even though AI was used for only a small part of the project."
That exposure is spreading as contractor AI use grows. ServiceTitan's 2026 Commercial Specialty Contractor Industry Report surveyed more than 1,000 industry leaders. It found that 38% of contractors now report measurable business impact from AI, up from 17% in 2025. Cost estimating and bid management were the most common applications, at 24% and 22%, respectively.
The absence of a replacement product is the structural difference between this rollout and earlier coverage transitions. When ISO addressed cyber risk in standard CGL policies, standalone cyber insurance was available for businesses that wanted to buy coverage back. The Trades Coverage report found no admitted standalone product for contractors that replaces the excluded AI exposure.
Carriers introducing AI exclusions are following the same pattern used to address silent cyber exposure. The industry has been drawing that comparison openly, but the follow-on market for contractors does not yet exist. The filing data covers admitted-market SERFF filings and Florida I-File records, so exclusion activity across non-admitted markets is likely wider still.
Every state except Minnesota has at least one exclusion record, so geography is not the filter brokers need. Any policies renewed since August 2025 may carry one of the ISO forms or a carrier-drafted equivalent. The Trades Coverage report notes that large construction companies keep risk managers to monitor filing activity of this kind. At smaller contractors, that job falls to the broker.
